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Designing long-term disability plans: tax efficiency vs. maximizing wage replacement.
Benefits Q 2003; 19(1):51-60BQ

Abstract

The tax treatment of long-term disability plans raises difficult questions for employers and employees, as it necessitates a tradeoff between tax efficiency and maximizing wage replacement for disabled workers. By using simplified case examples, this article illustrates the advantages and disadvantages of different plan design choices. The authors conclude that, in most cases, long-term disability coverage should be mandatory but that employees should be given the choice to decide whether their coverage is taxable.

Authors+Show Affiliations

CSA Group, Toronto, Canada.No affiliation info available

Pub Type(s)

Comparative Study
Journal Article

Language

eng

PubMed ID

12608119

Citation

Luecke, Randall W., and Dennis T. Blair. "Designing Long-term Disability Plans: Tax Efficiency Vs. Maximizing Wage Replacement." Benefits Quarterly, vol. 19, no. 1, 2003, pp. 51-60.
Luecke RW, Blair DT. Designing long-term disability plans: tax efficiency vs. maximizing wage replacement. Benefits Q. 2003;19(1):51-60.
Luecke, R. W., & Blair, D. T. (2003). Designing long-term disability plans: tax efficiency vs. maximizing wage replacement. Benefits Quarterly, 19(1), pp. 51-60.
Luecke RW, Blair DT. Designing Long-term Disability Plans: Tax Efficiency Vs. Maximizing Wage Replacement. Benefits Q. 2003;19(1):51-60. PubMed PMID: 12608119.
* Article titles in AMA citation format should be in sentence-case
TY - JOUR T1 - Designing long-term disability plans: tax efficiency vs. maximizing wage replacement. AU - Luecke,Randall W, AU - Blair,Dennis T, PY - 2003/3/1/pubmed PY - 2003/3/21/medline PY - 2003/3/1/entrez SP - 51 EP - 60 JF - Benefits quarterly JO - Benefits Q VL - 19 IS - 1 N2 - The tax treatment of long-term disability plans raises difficult questions for employers and employees, as it necessitates a tradeoff between tax efficiency and maximizing wage replacement for disabled workers. By using simplified case examples, this article illustrates the advantages and disadvantages of different plan design choices. The authors conclude that, in most cases, long-term disability coverage should be mandatory but that employees should be given the choice to decide whether their coverage is taxable. SN - 8756-1263 UR - https://www.unboundmedicine.com/medline/citation/12608119/Designing_long_term_disability_plans:_tax_efficiency_vs__maximizing_wage_replacement_ DB - PRIME DP - Unbound Medicine ER -